Press release

Consumer confidence in global banking industry bounces back

Johannesburg, 11 March 2014

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Consumer confidence in global banking industry bounces back

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  • Trust in banks is underpinned by the quality of people’s personal banking experience
  • Competition is intensifying as customers consider using alternative providers

After a number of years of sharp decline, confidence in the banking industry is on the rise, trust in individual banks is high and most customers across the globe are satisfied enough to recommend their main banking provider, finds EY’s 2014 global consumer banking survey.

The study, Winning through customer experience, which surveyed over 32,000 banking customers in 43 countries, which included South Africa, Kenya and Nigeria, shows banks are providing traditional banking services well but are viewed as falling short on important aspects of the customer experience, and are also increasingly vulnerable to competition from new providers of banking services.

Marius van den Berg, EY Advisory Banking Sector Leader for Africa says, “Despite another challenging year for banks globally, confidence in the banking industry among African customers has experienced a significant increase most notably in Kenya and Nigeria, with South Africa tracking the global trend.”

Confidence and trust are building among bank customers
Customers in emerging markets in general have recorded a higher increase in confidence than the global average. Across Africa, confidence has increased most in Nigeria (69%), followed by Kenya (66%) and South Africa (33%). Forty four percent of customers globally express complete trust in their primary financial services provider, with the strongest levels in Africa observed among customers in Kenya (59%), followed by Nigeria (48%) and South Africa (45%).

Likelihood to recommend primary financial service provider
African customers express stronger advocacy for their primary financial service provider than seen globally. Customers in Kenya (62%) are the strongest advocates, followed by South Africa (51%) and Nigeria (46%), to recommend their primary financial service provider.

The survey finds customer experience to be a main driver of trust, and customer experience is also the single most common reason that customers open and close accounts – it is more important than fees, rates, locations, press coverage or convenience. “The vast majority of customers in Africa define their primary financial service provider as a bank, although a notable group of customers in Kenya (21%) uses a mobile service as primary provider,” says van den Berg.

Customers are on the move
Fifty-two percent of customers globally have opened or closed at least one product in the past year and 40% plan to in the coming year. In South Africa, 44 % of clients surveyed said they intend to open or close an account in the next year. This is higher than the average for the African countries surveyed (34%) and the global average of 40%. Experience with a service provider is not only a key driver of trust, globally it is also the single most common reason for opening and closing accounts.

Key improvement areas for banks
The survey finds there are three key improvement areas for banks:

  1. Make banking simple and clear through transparency of fees, simplicity of offers and communication, and delivery of an omni-channel experience (omni-channel can be described as a seamless approach to consumers across multiple channels).
  2. Help customers make the right financial decisions in a complex environment through more and better advice and through greater use of data and digital channels to empower customers.
  3. Work with customers when problems arise and become their advocate through improved problem resolution capabilities.

-Ends- 

Taking a fresh approach to segmentation
The extensive survey examines 31 core elements of customers’ banking expectations and preferences. In the report, the 35,642 customers were grouped into consumer segments sharing behavioral characteristics, products, channel preference and reasons for trust – rather than only traditional age, geography or income metrics.

Each segment varies by size, assets and willingness to pay more for key benefits and is found in all markets across the world. This segmentation provides a fresh lens to help banks identify strategies that more effectively engage customers and invest resources for future growth.

To download the full report, view the customer segmentation infographic, watch videos discussing the survey’s findings and explore data please visit www.ey.com/globalconsumerbankingsurvey.

About EY

EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.

EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com.

This news release has been issued by EYGM Limited, a member of the global EY organization that also does not provide any services to clients.

Following on from EY’s successful integration in 2008 of 87 countries into one area from across Europe, Middle East, India and Africa (EMEIA), the firm has launched its Africa Business Center™ (ABC), which aims to enhance the effective and efficient links between its geographic reach and areas of expertise. The firm enjoys representation in 33 countries across Africa.

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